The state of the economy at the street level

[Tyler Durden]

Went to Eastwood tonight to visit an elderly woman in her home business, and she told me that a lot of shops in that area were closing down. Afterwards I went to eat in the small Taiwan street food market and noticed only about half of the restaurants were open. I remember this was quite a lively place a few years ago, but things seem to have changed.

 

[sptrawler]

Went to Eastwood tonight to visit an elderly woman in her home business, and she told me that a lot of shops in that area were closing down. Afterwards I went to eat in the small Taiwan street food market and noticed only about half of the restaurants were open. I remember this was quite a lively place a few years ago, but things seem to have changed.

Sydney must be slowing down? It needed to it has been going gang busters, over the last few years.

 

[moXJO]

I'm getting mixed signals. But its still looking like a slow down. Some areas are really struggling (retail).

The government being quiet on the issue isn't really helping. Do they have a plan? ? ?
I understand keeping politics out of the news. But going to far and releasing nothing looks worse.

 

[sptrawler]

I'm getting mixed signals. But its still looking like a slow down. Some areas are really struggling (retail).

The government being quiet on the issue isn't really helping. Do they have a plan? ? ?
I understand keeping politics out of the news. But going to far and releasing nothing looks worse.

Hopefully the Government is working on a plan, in the past Governments seemed to have rushed out answers and they turned out to be a mess, probably because of the 24/7 news cycle these days.
IMO the one thing in Australia's favour, is the fact we haven't got into the money printing yet, that leaves a lot of wriggle room with regard infrastructure and stimulus spending.
Also being a resource based economy, when they do start the money printing, our currency should drop and make our 'stuff' cheaper on the World market.

As far as Perth goes, I'm seeing a lot of the houses that have been on the market for over 12 months are now selling, those are actual houses I ride my bike past.
But the shops don't seem to be any busier, only food outlets and supermarkets appear busy, if they sell coffee and fast food they appear to be doing o.k.
Just my opinion.

 

[moXJO]

Hopefully the Government is working on a plan, in the past Governments seemed to have rushed out answers and they turned out to be a mess, probably because of the 24/7 news cycle these days.
IMO the one thing in Australia's favour, is the fact we haven't got into the money printing yet, that leaves a lot of wriggle room with regard infrastructure and stimulus spending.
Also being a resource based economy, when they do start the money printing, our currency should drop and make our 'stuff' cheaper on the World market.

As far as Perth goes, I'm seeing a lot of the houses that have been on the market for over 12 months are now selling, those are actual houses I ride my bike past.
But the shops don't seem to be any busier, only food outlets and supermarkets appear busy, if they sell coffee and fast food they appear to be doing o.k.
Just my opinion.

And this is happening:
"The largest goods and services surplus on record at $13.6 billion, helped decrease Australia's current account deficit in seasonally adjusted terms by $3.4 billion to $2.9 billion in the March quarter 2019, according to latest information released by theAustralian Bureau of Statistics (ABS)."
Mainly due to commodities, maybe an upside for WA.

 

[sptrawler]

And this is happening:
"The largest goods and services surplus on record at $13.6 billion, helped decrease Australia's current account deficit in seasonally adjusted terms by $3.4 billion to $2.9 billion in the March quarter 2019, according to latest information released by theAustralian Bureau of Statistics (ABS)."
Mainly due to commodities, maybe an upside for WA.

In my opinion it isn't as bad as the media make out, no point in throwing money around until it is absolutely necessary, nothing worse than shooting all the bullets then the tiger walks around the corner and you have nothing left.
At the moment we seem to be treading water, but we aren't going under, my gut feeling is we might just get through this. Our economy lags the rest of the Western World by a few years, we are going down as they are coming up, so hopefully we start and see a turn around.
After the GFC and the money printing, it was never going to be a smooth recovery.
Just my opinion.

 

[satanoperca]

SP, your commentary is 100% appreciated, however
Are you kidding me, our economy must go through a reset and the general population has no f---king idea of what hardship is.
Australia developed and grew through hard work, I fail to see this today, we still believe we are the lucky country and for all extends we are. But not reset, no recession in 30 years, we are all on borrowed time, we have become complacent as a nation, our leaders have failed us. ....
Maybe not our leaders, they are controlled by our media, which is interned controlled by the people, who has become complacent in understanding the world we all live in, the global world.

 

[moXJO]

Are you kidding me, our economy must go through a reset and the general population has no f---king idea of what hardship is.
Australia developed and grew through hard work, I fail to see this today, we still believe we are the lucky country and for all extends we are. But not reset, no recession in 30 years, we are all on borrowed time, we have become complacent as a nation, our leaders have failed us. ....

Look this is my thinking 100%.
Prices are to high for everything. Workers are spoilt, bosses want to charge too much etc.
But I thought the same thing back in 2007 as well.

All indicators point to armageddon. But how long will it hold up?
12 years is a long time if I had of sat and waited for opportunities.
I'd rather keep a finger on the pulse.

 

[Smurf1976]

https://www.theage.com.au/business/...-tries-to-revive-airline-20190828-p52lkc.html

So Virgin is losing serious money and Qantas, whilst still profitable, is making less profit than it was previously.

Given that between them the two companies hold a duopoly over most domestic aviation routes in Australia, this would seem to suggest that the underlying demand for travel isn't going too well.

 

[SirRumpole]

https://www.theage.com.au/business/...-tries-to-revive-airline-20190828-p52lkc.html

So Virgin is losing serious money and Qantas, whilst still profitable, is making less profit than it was previously.

Given that between them the two companies hold a duopoly over most domestic aviation routes in Australia, this would seem to suggest that the underlying demand for travel isn't going too well.

Just another indicator of a tanking economy I'm afraid.

 

[sptrawler]

https://www.theage.com.au/business/...-tries-to-revive-airline-20190828-p52lkc.html

So Virgin is losing serious money and Qantas, whilst still profitable, is making less profit than it was previously.

Given that between them the two companies hold a duopoly over most domestic aviation routes in Australia, this would seem to suggest that the underlying demand for travel isn't going too well.

I think it is a bit like every other big business, with big overheads trying to eke out profits from a relatively small population, it is hard as the mobile phone industry is finding out.
Coles and Woolies, are finding it tough, especially with the new entrants.
Maybe Australia can only support one major airline?, plenty of others in this space, have gone under in the past.

 

[SirRumpole]

Maybe Australia can only support one major airline?, plenty of others in this space, have gone under in the past.

True, however the perception of choice has to be maintained, thus JetStar, a subsidiary of Qantas but catering to a different market.

 

[Smurf1976]

Just another indicator of a tanking economy I'm afraid.

That was my thinking.

In the Australian context the airlines in aggregate don't really have competition from an alternative means of transport. Anyone who's traveling interstate by road or rail in 2019 generally woudn't consider flying as an alternative since they're driving or on a train for the journey itself, not simply to get to the destination, or are towing a caravan or whatever. Likewise those who fly generally wouldn't consider a land based alternative unless there really was no choice.

That being so, the airlines in aggregate, and ultimately there's only two, would seem to be a reasonable proxy for business and leisure travel.

Now thinking of my own life and anywhere I've worked, if finances get tight then interstate / overseas travel tends to be one of the first things to come under serious scrutiny. In business it's often not absolutely essential, it's a nice to have but if there's a need to cut costs well then it's often not critical, and for consumers it almost never is.

Struggling airlines thus suggests business and consumers alike are tightening their belts.

 

[sptrawler]

When was the last time Virgin earned a profit? Things are definitely tougher ATM, but I don't think they have made a profit for a number of years, their share price hasn't moved much for years.
https://www.smh.com.au/business/com...a-dances-ownership-tango-20180110-p4yydg.html
From the article:
Virgin ran at a $224.7 million net loss in 2016 and a$185.8 million loss in 2017. But it is cash-flow positive for the first time in five years and says its turnaround plan is running ahead of expectations.

That article was January 2018.
It's a high cost business, that has to flip expensive planes.

 

[sptrawler]

Given that between them the two companies hold a duopoly over most domestic aviation routes in Australia, this would seem to suggest that the underlying demand for travel isn't going too well.

The other thing, apart from a sliding economy, that will be affecting Qantas and Virgin IMO, is cruising. There has been a huge increase in people choosing cruises, as a holiday in recent years, especially on the East Coast.
I think a lot of people have decided a cruise is better value, than a flight and accommodation in Australia.

http://www.traveller.com.au/almost-...ve-taken-a-cruise-clia-industry-report-h10mq9

From the article: 2017
Did you know that almost one in 18 Australians have taken a cruise? And that most Aussie cruisers come from NSW?

Where are we cruising? The report revealed that Australians still spend most of their time cruising local waters with the Pacific islands (35 per cent), Australia (34 per cent) and New Zealand (8 per cent) accounting for the most cruise passengers.


This from 2018:
Australia once again leads the established cruise markets in penetration rates, with 5.8 per cent of the population taking an ocean cruise in 2018, or the equivalent of almost one in every 17 Australians. This compares to 4.0 per cent in the USA, 3.0 per cent in the UK, and 2.8 per cent in Germany.

 

[qldfrog]

And it does not help we are still importing unemployment and salary misery
https://www.macrobusiness.com.au/2019/08/australias-skilled-visa-program-piles-idle-migrants/
You will nor read this on the abc

 

[SirRumpole]

And it does not help we are still importing unemployment and salary misery
https://www.macrobusiness.com.au/2019/08/australias-skilled-visa-program-piles-idle-migrants/
You will nor read this on the abc

The shortage of skilled local workers is a real bollocking for our education system.

Why are we not educating local people in the skills that are needed here ?

Too many BS Arts courses and not enough real engineering or science graduates.

Dan Teghan on Press Club yesterday was pathetic. Treats universities as businesses and the more foreign fee paying students the better. What about the needs of the Australian population (taxpayers) for skilled workers ?

 

[sptrawler]

The shortage of skilled local workers is a real bollocking for our education system.

Why are we not educating local people in the skills that are needed here ?

Too many BS Arts courses and not enough real engineering or science graduates.

Dan Teghan on Press Club yesterday was pathetic. Treats universities as businesses and the more foreign fee paying students the better. What about the needs of the Australian population (taxpayers) for skilled workers ?

Way too much social engineering, telling everyone kids need to go to school untill year 12, then go to Uni.
Australia needs a reset, they have been steered way too far off line, we as a Country are wandering around in the intellectual wilderness, still being led by ideological BS.

 

[tinhat]

I don't know what it's like in other states but here in NSW the government has completely gutted the public funding of technical further education and the private sector is a complete farce and market failure - kids getting into large debt to get a trade certificate in personal training or hairdressing.

 

[sptrawler]

What I've noticed is the amount of kids that now go to university, in the 1970's it was 5% of students, now it is 50% of students.
The only reported difference I've read is, now a lot can't do basic maths and english and there are very few doing engineering and science courses.
They gutted tech schools because everyone goes to University, they made school leaving age year 12, the last thing 17 year old's want to do is become a first year apprentice. They have stuffed up in a huge way, wont admit it and just want to throw more money at a fundamentally stupid system.

So in reality, we have changed our education system into a child minding facility, that can be accessed well into your 20's.

In days gone by, many left at 15 to take up trades, others left at 17 to take on technical courses such as drafting, teaching, nursing etc.
Those who excelled in the academic subjects and passed year 12 and matriculated usually went to University.
As I said earlier, we need a big dose of back to the future.IMO
The problem is there are too many, making money from it, so don't want to fix it and only want more money thrown in the trough.
IMO that is why our Uni's are sliding down in World standards, because they are no longer just the realm of the creme de la creme of students any more, they are just factories that push through anything that pays.
Just my opinion